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Has Your Small Business Growth Stalled? Here’s Why.

November 24, 2017

Written by Community Futures Manitoba

Every small business has its periods of growth and stagnation. The difficulty is in knowing whether periods of lethargy are something to be worried about or are just short-term delays to wait out. Consider this a guide to deciphering the cause(s) of your small business sluggishness, as well as a solution manual to help your company recover quickly.

Burning the candle at both ends

Relying on yourself to manage most, if not all, of the day-to-day responsibilities is one of the most common causes of stagnation—the company can only grow as large as your capability to manage the pieces. The best solution is to start outsourcing duties, cutting out unnecessary tasks, or hiring a team member to split the work. This frees you to focus on your strengths that launch your business to the next level.

Tip: These 7 strategies can help to better manage your stress and perform at 100% every day!

Hazy vision or mission

Starting a small business without a vision and mission is like setting sail without a compass; there is a good chance that you will get lost. Be sure that you have a solid purpose (a “why”) behind your company when starting out and frequently assess whether your actions are contributing to this mission as you go along.

Tip: Our free Initial Business Assessment can help to verbalize your small business mission. Download your complimentary copy here.

Disengaged and/or untrained employees

Engaged employees, or workers who are happy in their roles, are 21% more productive than disengaged employees, according to Gallup. In fact, organizations full of highly engaged team members are four times as likely to succeed than companies with very disengaged employees.

When team members don’t care about the success of your small business (or they are not properly trained), everything from customer service to sales suffer. If your company is stuck in quicksand, take a hard look at your staff and consider what changes need to be made.

Offering a product/service that no one wants or chasing the wrong customer is a recipe for small business stagnation. That’s why doing research before starting a company is so important. Be sure to identify opportunities in your market, nail down your ideal customer profile, and ensure that your business fulfills a need in order to proactively prevent growing pains.

Tip: Sometimes even after you’ve identified your ideal client and start working them, it’s just not the right fit. This checklist can help to determine when a client is not worth it.

A changing landscape

The problem may not be your company at all, but rather the changing business landscape or up-and-coming disruptors. For instance, Uber came and disrupted the taxi industry. Netflix killed movie rental shops.

If your company experienced rapid growth in the beginning days and then things are suddenly slower than molasses, the culprit could be a changing market. In these cases, you must pivot and adapt your strategy and offerings to the new landscape! Start by asking your customers what they want and go from there.

Inconsistent marketing

You can have the best product, services, and team in the world—but it won’t make a bit of difference if you don’t connect with customers. Failing to invest in marketing on a consistent basis is a surefire way to lose traction over the long run.

This doesn’t mean you need a huge budget or a lot of spare time to succeed. There are plenty of free or inexpensive marketing strategies out there, such as social media marketing. Check out our guide to building marketing buzz in just 30 minutes a day!

Tracking the wrong metrics

We understand: seeing an uptick in the number of website visits or social media followers is exciting! However, if these numbers don’t contribute to your bottom line, they are ultimately the wrong things to focus on. Don’t get distracted by vanity metrics that can pull you off course. Decide which numbers to track on a day-to-day and week-to-week basis, such as percentage of returning customers and the cost to acquire each customer.

Poor customer service or failure to ask for referrals

If customers do not have a great experience with your small business, they will do more than just not come back: they will spread the word about their poor treatment. On average, unhappy customers will tell 16 connections about a dissatisfactory experience! That can quickly force your small business into a tailspin.

Additionally, not asking for referrals can impede company growth. Most happy customers are willing to provide testimonials or refer friends and colleagues to a small business that they are happy with, they just need to be prompted. Ask your customers or clients in person, send them reminder emails after their transaction, and/or connect with them on social media to provide a forum for feedback.

Inadequate funding

Have you outgrown your storage space? Need more capital to buy product that customers are clamoring for? Sometimes you need more money to take your company to the next level. Community Futures offers small business loans for just these occasions. Contact us to learn more about the ideal small business loan for your needs, or download a loan application here.

Have you ever wished for an entrepreneur roadmap to point you toward small business success? We have what you’re looking for!